Post office time deposit account (POTD) is one of the most well known investment schemes offered by the India Post to the general public. Post Office Time Deposit Scheme offered by India Post is particularly popular in rural and remote areas of India that are relatively under-banked and have limited access to investment products.

Post Office Time Deposit Scheme Interest Rates

The following are the interest rates of the post office time deposit account applicable from 1st October 2018 to 31st December 2018*:

Account Tenure

Applicable Interest Rate

1 Year Account

6.9%

2 Year Account

7.0%

3 Year Account

7.2%

5 Year Account

7.8%

*The above interest rates are subject to periodic change as per decisions of the Finance Ministry. The above rates are applicable from 1st October 2018 to 31st December 2018.

Key Features

The following are the key features of the post office time deposit schemes:

Deposits under post office time deposit schemes can have tenure of 1, 2, 3 or 5 years.

Premature Withdrawal of POTD Funds

Post office time deposit accounts permits the account holders to withdraw funds before maturity. A minimum of 6 months must have passed from the date of first deposit to qualify for premature withdrawal. The following are key terms and conditions in case of premature withdrawal of a Time Deposit :

If premature withdrawal of 1/2/3 or 5 year POTD is made after completion of 6 months but before completion of 1 year from date of time deposit account opening, simple interest is payable as per Post Office Savings Account interest rate.

If premature withdrawal of 1/2/3 or 5 year TD account is done after 1 year from date of account opening, the applicable interest rate is 1% lower that the interest rate corresponding to the tenure the account was originally booked for.